Recession, Billable Hours and Career Outlook Forum

[satorugojou]

I'm a first year in big law, no idea what I want to do long term. But I'm trying to understand what my possible career outcomes are and also keeping in mind possible market/general economy changes.

First question, what's big law associate job security like in recessions? I'm too young to have any real experience and don't have any knowledge besides stuff I've heard, but what happens to associates if the market tanks? I heard Latham fired a bunch of attorneys in 08', but that's about all. I'm not sure how representative that is of big law in general. Is there a significant difference V10 vs V50? Primary market (NY, SF, etc.) vs secondary market (Houston, Atlanta, etc.)? HQ office or Satellite office? Rainmaking practice group vs speciality group? I really don't know how any of this stuff plays out, and I'd appreciate any insights. Thanks in advance!

Secondly, assuming an associate does not get fired during a recession, what are the billable hour expectations? Do firms even pay bonuses on bad years? Smaller bonuses? Pay cuts? Also, if someone is planning on staying in big law long term, how do the hours from recession years affect their career? This is coming from someone who has no idea how it works, and I'm sure it's different at every firm, but aren't yearly billable hours a big consideration point for anyone trying to get promoted to of counsel/NSP? Will the firm kind of just understand that you couldn't bill much in X year because the market was slow and not hold it against you? Is this different between practice groups like general corporate vs a speciality group?

[The Lsat Airbender]

Quantitative judgments, or trying to hash things out by firm/location/practice area, depend too much on the recession in question. Corporate bankruptcies are good for certain biglawyers.

But yes, all of the above (pay cuts, withheld bonuses, mass layoffs) are on the table and indeed we saw as much as recently as 2020. If economic conditions provide, nothing stops firms from another Lathaming nowadays. Survival is the main thing you need to worry about as a junior/midlevel trying to make it long-term and the best way to ensure survival, in any climate, is to do as much work as possible without sacrificing quality.

[objctnyrhnr]

There are two non mutually exclusive things that you should be doing, if you think this is a real possibility within the next two years or so. Either of these two things probably will keep you safe:

1. Crush hours. That makes you profitable. They didn’t Latham everybody just like 10%. Which is a lot of course, but there were 90% who stuck around. I’d be willing to bet nobody who consistently hit bonus got pushed.

2. Become indispensable to a partner or two who matter, likely by virtue of your intimate knowledge of a set of facts or the like on one of your cases. So in the white collar context if you’re on a profitable years long investigation and you’re closest to the documents, you’ll likely be fine.

[Anonymous User]

Also consider diversifying your practice. As a previous poster noted, it's hard to tell exactly what parts of the legal industry would be hit hardest by a recession. You don't want to be like the mortgage backed securities specialists in '08. Try to maintain a broader practice so you can easily adjust if part of what you do gets hit hard.

Relatedly, some groups like RX (and to some degree lit) are countercyclical in that they get busier (or at least stay relatively flat) during a recession. I don't have any actual data from the Lathaming years, but intuitively I would think you're less likely to be cut from one of those groups. Other groups like M&A are probably most likely to be hit hard regardless of what the recession looks like.

Re: billables for counsel/NSP, again I don't have any data, but I think firms would look at relative hours. For example, in my group at my firm it's hard to even be considered for partnership without 2400+ during your previous few years. In other groups though, billing that much is pretty much unheard-of. So I would imagine that IF firms are still making NSPs/counsels during the recession (that's a big IF), then relative hours compared with your peers would be more important than absolute numbers.

[Anonymous User]

Relatedly, some groups like RX (and to some degree lit) are countercyclical in that they get busier (or at least stay relatively flat) during a recession.

Any ideas what firms are more profitable during recession?